Audit (A-02-07-02000)

02-05-2009
Review of Administration for Children and Families Grant Closeout Procedures

Executive Summary

We found that the 9,877 Administration for Children and Families (ACF) grants identified by the HHS Division of Payment Management (DPM) as eligible for closeout as of September 30, 2006, which had unexpended balances totaling more than $472 million, remained open in the payment system for several reasons. DPM is responsible for closing grants after receiving instructions from ACF or the HHS Division of Financial Operations. ACF is responsible for initiating closeout of grants. As a general rule, grants must be closed within 180 days after the end of the grant period (the cutoff date). However, the grants remained open after the cutoff dates because of staffing shortages; differences among the grant award, expenditure, and drawdown amounts in the payment system; or a lack of grant closeout procedures. Also, ACF and the Division of Financial Operations lacked follow-up procedures to determine whether DPM had actually closed grants for which closeout was initiated.

We recommended that ACF use the information in this report to ensure that grants are closed in a timely manner and to eliminate the backlog of grants eligible for closeout. In comments on our draft report, ACF described actions that it had taken or planned to take to implement our recommendation.